Gwangju and Jeonnam Manufacturing Business Sentiment Expected to Hit Year's Lowest in October

Bank of Korea Gwangju Jeonnam Headquarters CBSI Survey
Manufacturing at 76.3... Non-manufacturing at 90.7

Trends in the Business Sentiment Index for Manufacturing Companies in Gwangju and Jeonnam. Provided by the Bank of Korea Gwangju Jeonnam Headquarters

The business sentiment among manufacturing companies in Gwangju and Jeonnam saw a slight increase this month. However, forecasts indicate that it will decline again next month, reaching the lowest level of the year.

According to a survey conducted in September by the Bank of Korea Gwangju Jeonnam Headquarters on 601 local companies, the Composite Business Sentiment Index (CBSI) for manufacturing stood at 83.9, up 5.2 points from the previous month. However, the CBSI for next month is expected to fall to 76.3, marking the lowest level so far this year.

The CBSI for non-manufacturing companies rose by 1.0 point from the previous month to 87.1, and is projected to reach 90.7 next month.

For manufacturing, improvements in business conditions and a reduction in product inventory contributed to the rise. However, it is anticipated that new orders, sales, and production will all decline compared to the previous month.

In the non-manufacturing sector, profitability and sales showed some improvement over the previous month. Although overall business conditions are expected to remain challenging next month, profitability and financial conditions are projected to be better than the previous month.

Regarding management difficulties, manufacturing companies cited sluggish domestic demand and ongoing economic uncertainty. Compared to the previous month, a higher proportion pointed to increased competition and rising raw material prices as challenges. Non-manufacturing companies identified sluggish domestic demand, labor shortages and rising labor costs, and intensified competition as major factors.

The CBSI is a psychological indicator calculated based on key indices from the Business Survey Index (BSI). A reading above 100, the long-term average from 2003 to 2024, indicates an optimistic business sentiment, while a reading below 100 suggests pessimism.

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